Tuesday, July 29, 2014

But even if concerns turn out to be misdirected, popular commitments to Market Basket’s workers and to the company as a community institution are undeniable. The store is more than a business, as far as customers are concerned. As MIT economist Thomas Kochan has noted, the outcry is a rebuke to the Wall Street mentality whereby corporations exist only to enrich shareholders. That the rebuke is being felt, that the political weight of community and worker action is registering, is evident in the response from local bigwigs such as the Boston Globe's Shirley Leung, who has been red-baiting protestors and their supporters, as though walkouts and boycotts were not free-market activity.

Today, he has passed his duties on. “He’s kind of taking it in from the backseat,” Philip Sauma said. Philip runs the business day to day, while his brother, Eric, 29, is the creative, design-minded in-store operator. A daughter, Amy Altunis, 32, lives in London with her two young children. Recently, her nanny learned of the family business. “She screamed,” Ms. Altunis said.

Wilmers’s report, however, was less about the company’s numbers than about the dismal state of his beloved profession. Wilmers, it turns out, is that rarest of birds: a banker willing to tell harsh truths about banking. That, for instance, much of the money the big banks earn comes from trading profits “rather than the prudent extension of credit that furthers commerce.” That derivatives had helped bring about the crisis and needed to be regulated. That bank executives were wildly overpaid. That the biggest banks — the Too Big to Fail Banks — were operating, as he put it, an “unsafe business model.”

Back in the days when Henry Farrell read Tyler Cowen seriously, Steven Bainbridge was on Farrell's short list of readable conservatives. The responsibility of directors to shareholders was and is one of his primary interests. In a comment I just found from years ago I described him as "a vulgar materialist, a gourmand with a cross around his neck and a Porsche." It hadn't registered at the time that that none of them understood the difference between the aristocracy and petit bourgeois

One of the subsidiary links on the third link above is to NewApps, where I posted a comment linking to Bloomberg

Japan is the land of the bargain-basement CEO. On June 30 securities regulators began requiring Japanese companies to disclose pay for executives making more than 100 million yen ($1.1 million). While the headlines went to the top eaners—foreigners Carlos Ghosn of Nissan Motor (NSANY) and Sony's (SNE) Howard Stringer—the big surprise was how few Japanese business leaders take home super-size paychecks.

Although pay for Japanese executives has more than doubled in the past decade, the government says, fewer than 300 people at Japan's 3,813 public companies earned enough in 2009 to require disclosure, according to PricewaterhouseCoopers. Companies listed on Japan's stock exchanges paid their chief executives an average of $580,000 in salary and other compensation last fiscal year, PWC estimates, about 16 times more than the typical Japanese worker. Average CEO pay at the 3,000 largest U.S. companies is $3.5 million, including stock options and bonuses, according to the Corporate Library, a research group.

Most Japanese bosses have been hired from inside their companies. "There's no market for executives," says Kotaro Tsuru, a corporate governance expert at the Trade Ministry's research institute. "The reasonable price for a CEO is decided by each firm separately." Nissan's Ghosn, Japan's top-paid CEO, took home $10 million in 2009. Over at Toyota Motor (TM), meanwhile, Chairman Fujio Cho earned $1.5 million. CEO Akio Toyoda wasn't among the four executives who received more than $1.1 million (though as the founder's grandson, he owns about $160 million in company shares). Sony's Stringer, Japan's second-highest-paid executive, made $9.1 million. At rival Panasonic (PC), nobody earned enough to require disclosure under the new rules.

With wealth still considered unseemly in Japan, there's little pressure for salaries to rise. "My house is small, but I'm happy," says Yukio Sakamoto, CEO of Elpida Memory, Japan's largest semiconductor maker, whose pay was under the reporting threshold. "I commute by train every day and have never had a problem."

I found no compensation data for the past and present chairmen of TEPCO. Corruption takes many forms.

"Everything begins with psychology, and the psychology of capitalism is changing."
"The idea of the social isn't very interesting. It isn't even very social."

There are scholarly men, to whom the history of philosophy (both ancient and modern) is philosophy itself; for these the present Prolegomena are not written. They must wait till those who endeavor to draw from the fountain of reason itself have completed their work; it will then be the historian's turn to inform the world of what has been done.

"when we act, we create our own reality. And while you're studying that reality—judiciously, as you will—we'll act again, creating other new realities, which you can study too, and that's how things will sort out. We're history's actors…and you, all of you, will be left to just study what we do."

Historians win.
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jumping forward: the paradox of efficiency.
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I linked the two pages without thinking of the two Kants: the purblind/prescriptive, the observant and descriptive.